Journal Article

Opinion: Why Do Bank Runs Happen?

Abstract: The first half of 2023 has reminded us once again that banks are not immune from failure. In early March, Silicon Valley Bank (SVB) suffered a run on deposits and quickly collapsed. Its closure was followed by the failure of Signature Bank, a smaller bank, two days later. And even more recently, regulators exerted considerable effort to arrange the sale of First Republic Bank to a larger bank. The Fed was responsible for supervising and regulating SVB, and it recently issued its report examining what went wrong. I encourage you to take a look.

Keywords: Bank supervision; bank runs; deposit insurance;

Bibliographic Information

Provider: Federal Reserve Bank of Richmond

Part of Series: Econ Focus

Publication Date: 2023

Volume: 23

Issue: 2Q

Pages: 32